SANAULLAH KHAN VS PROVINCE OF BALOCHISTAN THROUGH SECRETARY,
FINANCE DEPARTMENT, QUETTA
1995 P T D 350
[Quetta High Court]
Before Munawar Ahmed Mirza, CJ. and Mir Muhammad Nawaz Marri, J
SANAULLAH KHAN
Versus
PROVINCE OF BALOCHISTAN through Secretary,
Finance Department, Quetta and 3 others
C. P. No. 103 of 1994, decided on 10/08/1994.
Income Tax Ordinance (XXXI of 1979)---
----S.12(1)---Liability of Government employee to pay income-tax---Employees working in Tribal Area whether exempted from payment of income-tax---Every Government employee, receiving salary from Federal Government, Provincial Government or any local authority of Pakistan was bound to pay income-tax at prescribed rate irrespective of his status of residence, place of posting or nature of work---Question about applicability of Income Tax Ordinance, 1979 in Tribal Areas has absolutely no relevancy, for income-tax deductions were based upon entitlement of persons for receiving salaries from State exchequer---Once Government employee received his salary from State exchequer, he automatically became liable to pay tax on his income, without any barrier of locality, place of service or nature of duties unless specially exempted ---Government employees belonging to and working in Tribal Areas, thus, could not claim exemption from payment of income-tax.
1992 SCMR 250 and 1990 MLD 1960 ref.
Amanullah Baloch for Petitioner.
Yakub Khan Yousufzai, Advocate-General for Respondents Nos.l and 2. FM
Raja Rab Nawaz, Deputy Attorney-General for Respondents Nos.3 and 4.
Date of hearing: 10th August, 1994.
JUDGMENT
MUNAWAR AHMED MIRZA, C. J: --Petitioner is a Government Officer in Education Department and presently posted at Dalabandin. It is asserted that employees in tribal areas are exempted from payment of Income Tax, as Income Tax Ordinance, 1979 has not been extended to Provincially Adminisered Tribal Areas. Following relief has been claimed in the petition:--
"9. "It is, therefore, accordingly respectfully prayed that this Honourable Court may be pleased to declare;
(i) that the petitioner and other employees working in Dalabandin, a declared Tribal Area are exempted from payment of Income Tax as per notification Annexure "A", and
(ii) that the Memorandum dated 7-5-1994 Annexure "E" issued by respondent No.2 in persuance of letter of respondent No.l Annexure `D' on the purported advice of respondent No.4, as contained in Annexure `C' is illegal, discriminatory without lawful authority and of no legal effect;
(iii) directing the respondent No. 2 to withdraw the Memorandum dated7-5-1994;
(iv) Such other relief that may be deemed appropriate be also granted alongwith costs.
Learned Advocate-General and learned Deputy Attorney-General, have appeared pursuant upon pre-admission notice issued by the Court.
Mr. Amanullah Kunrani, Advocate strenuously urged that the provisions of Income Tax Ordinance, 1979 have not been extended to tribal areas, therefore, deductions from the salaries of Government employees serving or belonging to tribal areas cannot be made. To substantiate the plea, reference has been made to S.R.O. 659. (1)/81. Regarding maintainability of petition, learned counsel placed reliance on the observations made by Honourable Supreme Court in judgment reported as 1992 SCMR 250 and judgment of this Court in 1990 MLD 1960.
Learned Deputy Attorney-General referring to section 12 of Income Tax Ordinance, urged that every employee of the Federal or Provincial Government or Local Authority within Pakistan irrespective of his place of service was liable to pay Income Tax.
Learned Advocate-General also supported the above assertion and emphatically added that S.R.O. 659. (1)/81 relied upon by petitioner itself suggests application of Income Tax Ordinance in the tribal areas.
We have carefully examined the above contentions, and perused relevant law.
Main grievance agitated in the petition relates to income tax deductions from salaries etc. of the Government employees, who being residents of tribal areas are working there. Section 12(1), Income Tax Ordinance, 1979 regulates recovery of Income Tax chargeable from salaried persons, which however is reproduced below for ready reference:---
"12(1) Income which would be chargeable under the head `Salary' shall be deemed to accrue or arise in Pakistan, wherever paid, if it is earned in Pakistan, or if it is paid by, or on behalf of, the Government or a local authority in Pakistan to a person in the service of such Government or authority, as the case may be."
Perusal of above provision manifestly discloses that every Government employee, receiving salary from Federal Government; Provincial Government or any local authority of Pakistan is bound to pay income tax at prescribed rate irrespective of his status of residence, place of posting or nature of work. The question about applicability of Income Tax Ordinance, 1979 in the tribal areas has absolutely no relevancy because, income tax deductions are based upon entitlement of persons for receiving salaries from State exchequer. Therefore we are inclined to respectfully observe that reference to above-quoted judgment or bar under Article 247 of the Constitution while considering liability of Government Employees regarding payment of Income Tax has no nexus with the proposition under consideration. We therefore, feel no difficulty in concluding that once Government employee is receiving his salary from State exchequer, he automatically becomes liable to pay tax on his income, without any barrier of locality, place of service or nature of duties unless specially exempted.
Notification No.SRO 659(1)/81 providing limited exemption to contractors regarding execution of contract work in Tribal Areas relied upon by the petitioner instead of advancing his case, clearly negates the claim put forth by him.
For the above reasons, we do not find any substance in the petition which is consequently dismissed in limine.
A.A./490/QPetition dismissed.